All Forum Posts by: Nathan Williams
Nathan Williams has started 35 posts and replied 167 times.
Post: What would you do? (Starting out)
- Posts 172
- Votes 93
there's also varying degrees of rehab. If you are just starting out I believe there's nothing wrong with buying a property that may be closer to market value but needs very little work done to be "rental ready".
As an out of state investor I dont have the stomach to take on big rehab properties, instead I've found good condition homes that have made solid returns on purchase price
Post: BRRR Actual Deal - $2M profit or $15K/mo cashflow: with pictures!
- Posts 172
- Votes 93
Originally posted by @Michael Ealy:
Originally posted by @Aaron Bonne:
Nice work @Michael Ealy! Very inspiring!
Place looks awesome. Have you gotten it re-appraised at the $4.4MM yet? $140K per unit seems high for Avondale as I'm here in Cincinnati as well, but based on your NOI and cap rate I don't disagree it could get to that.
Just curious if the bank will get you to that # given expenses are low and if they would "penalize" you for operating it so well given it's a 1960's construction, despite being a total gut rehab. Just curious!
Thanks!
I think so.
Cost of new construction of properties comparable to ours is $190K/unit so $4.2M or $140K/unit is very feasible. That's based on $1250/mo per unit in rents which could very well be below market given that we have a waiting list of tenant-prospects.
We'll see - but regardless, even if the market changes tomorrow and cap rates rise up, cashflow will still be good.
Can you explain what you mean by cap rates rise up? Im confused because alteast my understanding has been that an increase in cap rate is a good thing as it means you are getting a better net cash flow ratio compared to your purchase/cash-in price or current valuation of the property.
I think a recession is coming but I dont think it will be nearly as bad as the one before where lenders were giving away loans to people who couldnt repay them. Im personally not too concerned as I buy and hold so a temporary dip in value will not have much impact on me.
i invest in some REITs through my 401K and while they have performed well over years, they dont really standout compared to other investment funds im in, and they dont touch the level of returns you probably are hoping to reach in real estate
Post: BRRR Actual Deal - $2M profit or $15K/mo cashflow: with pictures!
- Posts 172
- Votes 93
very impressive and inspiring deal! Im in no position to give advice to someone of your experience, but if Im in that position Im definitely taking the 2MM without hesitation as 15K/month is "only" a 9% return on equity.
Post: Turn Key Companies to recommend or stay clear
- Posts 172
- Votes 93
Originally posted by @Caleb Heimsoth:
@Robin Gravlin. Definitely avoid Morris invest and don’t buy anything under 75k.
I really do not understand the recommendation of not buying anything under 75k. You can find properties in this price range that are in decent enough neighborhoods and in good condition and can have a stronger cap-rate over more expensive properties. Also its a good way to start off if you want to first limit your exposure until you get more comfortable.
Post: Turn Key Companies to recommend or stay clear
- Posts 172
- Votes 93
I think the first step is to determine what out of state market you want to invest in and go from there.
I have no personal experience but heard good things from Holton-Wise in Cleveland.
Also I recommend not limiting yourself to only turnkey providers. You can also find a good condition home, sign up with a reputable property manager who will handle any minor things needed to get it rental ready and get it occupied with tenants. Theres also the possibility of finding properties in good condition that already have an established tenant in place.
Post: Side hustle in the RE field
- Posts 172
- Votes 93
Id say the best starting point is house hacking... buying a multi-unit on FHA loan to live in one unit and rent out the other unit(s).
If duplexes and bigger are out of your price range then even a SFH could be a good option. Buy a home on FHA and get a roommate or 2.
Post: $5800 closing cost for SFH $85k
- Posts 172
- Votes 93
I'll just throw out there as a point of reference that I am in closing right now on a property in Indiana for ~50K and closing fees are under $500 with most of that going to stuff charged by the title company. This is a cash sell so no lender fees and such.
Post: Analyzing homes on the market, numbers never work.
- Posts 172
- Votes 93
Originally posted by @Christopher Davis:
Originally posted by @Nathan Williams:
what about Memphis? from google maps its a manageable 3 hour drive away from Nashville. If i was in driving distance to Memphis that would definitely would have be my first option. Ive calculated some pretty impressive ROI %s on some properties there but they were in D/F neighborhoods.
Really? You think 3 hours is manageable in terms of tenant needs, spontaneous service calls, etc. I am looking about an hour around Nashville. I was thinking it's best to be closer, 3 hours seem like "long distance" investing. I was expecting to have a first deal relatively close so I can monitor the property if things need maintenance. Who the heck knows. There are more opportunities in a wider area of course.
Yes, ofcourse 3 hours away would be too far for that... I assumed you would be hiring a property manager. Im saying its a manageable drive for that occasional need for you to physically be at the property, such as viewing it and getting a feel of the neighborhood before buying or performing/coordinating some pre-planned work to get it rental ready.